Bitcoin halving explained and how to trade it
The Bitcoin halving is a special event that happens every 4 years. To realize the bitcoin halving, or as the digital underworld called it ‘the halving, it’s basic to realize the principles of bitcoin itself. In this article, we will explain everything you need to know about Bitcoin.
What is Bitcoin halving?
Bitcoin mining is a huge business in which miners use high-spec computers to help process bitcoin transactions. These transactions are added as ‘blocks’ to the blockchain ledger which is the technology that supports cryptocurrency.
The miners who perform this work need large computer power which comes at a cost. and The miners can then sell their gained bitcoins via an exchange.
The halving refers to the 50% degradation in compensation to miners that keep the bitcoin network. What has traders and investors most excited is what could occur to the price of bitcoin during this time.
When is Bitcoin halving and what will occur?
The halving happens once every 4 years or whenever 210,000 blocks have been mined.
Many analysts suggested the halving would happen between 10-12 May but this could vary on either side. The halving saw miner’s rewards decrease from 12.5 bitcoins per block to 6.25 bitcoins. When bitcoin was first released the mining prize was 50 bitcoins. On 28 Nov 2012, the amount dropped to 25 bitcoins and on 9 July 2016, it dropped again to 12.5 bitcoins.
However, what has traders, investors and crypto enthusiasts excited about is the fact the number of bitcoins entering the supply chain will shrink while demand – all else being equal – will stay around the same levels. This shift in supply vs demand could help drive the cryptocurrency’s price higher.
How to trade bitcoin halving?
There are two main ways to trade bitcoin. The first is to buy physical bitcoin through a cryptocurrency exchange. Many of them are unregulated entities that have been prone to hacks and theft in the past. In 2018, Japan’s Coincheck was hacked and over $500 million worth of digital currency was stolen.
The second way to trade bitcoin is to speculate on its price movement through cryptocurrency CFDs (Contracts for Difference).
The Bitcoin halving is a special event that happens every 4 years. To realize the bitcoin halving, or as the digital underworld called it ‘the halving, it’s basic to realize the principles of bitcoin itself. In this article, we will explain everything you need to know about Bitcoin.
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